Retail Winners and Losers this Christmas

Dec 7, 2012 1:07 pm GMT

After the excitement of Mega Monday, news from the British Retail Consortium that Christmas footfall has already started to build and mixed results from some of Europe’s biggest retailing names, we thought we’d take a look at which retailers are the likely winners in terms of sales this Christmas. As well as those which may struggle to keep the tills jangling over the crucial Christmas period.

It’s off to a good start, with sales for the week to Dec. 2 coming in 9.3% higher than the same week last year.

Maggie Porteous, head of selling operations, said: “All areas from toys, to bedding and ready-made curtains, to tablets are performing very well. As well as buying gifts and getting their homes ready for the festive period, customers are also ensuring they keep warm with cold-weather clothing and heaters selling fast.”

Marks & Spencer may not do as well as it hopes this Christmas, despite its glitzy advertising campaign. Analysts at Barclays reckon the high street clothing, homeware and food retailer is on track to lose market share in general merchandise over the festive period, as rivals improve their product offerings. They also believe M&S faces stiff price competition which won’t help its cause as cash-strapped shoppers hunt out bargains.

While M&S jumpers and underwear may not be under the Christmas tree, its food is likely to make it onto many a festive menu. Analysts think food sales at M&S will once again benefit as consumers treat themselves to more expensive, better quality food and drink for Christmas.

Despite being a popular choice for toys in the run-up to Christmas, Argos will likely remain in the doldrums because it is heavily dependent on consumer electronics and home enhancement both of which are suffering in the austere British economic climate, according to Jamie Merriman at Bernstein Research.

“The recent Amazon data for the U.K. indicates what everyone already believed, that it is growing extremely quickly and this is more of a threat to Argos,” she said. Argos is owed by London-listed Home Retail Group.

Tesco, the U.K.’s biggest retail group, is a possible winner this year. It shouldn’t be hard for it to beat last year’s 2.3% fall in like for like sales (which exclude sales from new selling space) for the six weeks to Jan. 7. Investors will be looking for a significant return to growth but with non-food sales still under pressure, Espirito Santo analyst Caroline Gulliver is cautious.

France

We all know the French love their food. So, perhaps it’s not surprising to hear that French hypermarkets are tipped as likely winners this Christmas, according to analysts…